European companies need to act fast to define the best strategies to connect, partner or compete against Chinese players. Often unnoticed by business leaders in Europe, Chinese technology companies are on the move. Hardly a week goes by without news that Alibaba has acquired a company in Southeast Asia, Tencent has invested in an Israeli startup or that Baidu is entering a new industry. Western onlookers may think that this is unlikely to have a direct impact on their businesses. And if they are concerned or interested, often the deals are more complex and opaque than first imagined. But, there are three important reasons why the rise of digital China cannot be ignored: the scale and speed of Chinese tech investments in Europe; the unique Chinese approach to organization; and the innovation imperative for Chinese companies leveraging a comparative advantage in technology rather than cost.

There is no place in the world more dynamic than China. Change is the essence of being in China. The only way to connect to China is to embrace change. At least, that is what Chinese companies teach us. Indeed, it is time to look east, to learn from China, to embrace and absorb innovative ways of doing business. My interest has always been to understand how organizations can thrive on uncertainty rather than treat uncertainty as a problem. My decade long research on China’s digital business ecosystems – Baidu, Alibaba, Tencent, Xiaomi and LeEco – and on hidden innovators – technology ventures, change makers and hidden champions – all point in the same direction. Chinese companies excel in boundaryless ways of organizing and leverage digital technologies to do so successfully. It is necessary to ‘connect digitally’ and ‘disconnect organizationally’ to be able to embrace the dynamics in China.

Columnist Micheal Kelly (dean of the Lazaridis School of Business) says two recent business books are must-reads for anyone who wants to understand how China’s tech renaissance is reshaping the world’s economy. My recent book Business Ecosystems in China is one of them. The other book is by colleague George Yip on China’s Next Strategic Advantage. Kelly writes: “In an increasing number of areas – including fintech, electric vehicles, artificial intelligence, gaming and more – China is becoming a world leader in technological innovation. Many of the trends emerging there are now beginning to have a significant impact on the global technology landscape. If you still think of China as just a large unsophisticated market, populated by unprofitable state-owned enterprises and copycat companies, these two books will open your eyes to this new competitive reality.”

Young people in big cities seeking emotional outlets by embracing loneliness and consuming loneliness. A new type of Chinese consumer: well-educated, young and willing to spend – but spending alone. The empty nest youth is an emerging theme in China’s economy. Mini karaoke booths, one-pot hotpot restaurants and many mobile games to accompany the lonely. We may see a phenomenon, facilitated by technology, where young Chinese people, especially millennials, are looking for individual experiences and personalized services more than the previous generation; not unlike their peers in other countries. However, I’d argue that technology is facilitating loneliness rather than allowing Chinese consumers to embrace it. There is plenty of evidence that youngsters would rather spend time on their smartphones than on playing with friends, dating, working and just hanging around. The slightly addictive nature of certain social networks and the fact that a handful of technology giants control those information streams does make me worry about the long-term societal effects.

Guizhou and its capital were put on the fast track to economic growth in 2013; growing over 10% in 2017. Big data is one of the focus areas for this once poorest province of China. Big data and artificial intelligence are considered as the technology to shape the future and thus make China the leading technology power. China has a clear advantage in big data because a lot of big data is collected, stored and analysed. With the average high acceptance and connectivity of mobile digital technology, the exponential growth of big data in China cannot be ignored. Not only the government support is there, but also, the market, technology and capital necessary for real big data technology innovations.

Tying in with the World Economic Forum’s Industry and Business Agenda and Future Agenda, we ask about the impact of new technologies such as AI. What skills will organisations need to thrive and how can they best leverage AI to their advantage? How will AI impact business decision making?

The Chinese economy — much like the daily life in many regions in China — can be characterized by one word: Change. Fast-paced, constant change. It’s been going for decades. The first generation of today’s biggest entrepreneurs started in the 70ies. They excelled in adapting their business to a growing demand. The responders. The next generation of entrepreneurs were driven by the opportunities the internet and e-commerce brought. We are talking about the BAT: Baidu, Alibaba, Tencent. The Internet leaders. What is there left to do as a startup when faced with a market that is driven by a few seemingly omnipotent players? The answer is disruption. The 3rd generation of Chinese entrepreneurs have emerged over the last 5–8 years. The Change Makers.

Barely a decade after the global financial crisis, China’s economy is shedding its “factory of the world” past and embracing an innovative future built on a business ecosystem supported by rising companies such as Baidu, Alibaba, Tencent and Xiaomi and more than 1,000 new venture investments by the country’s nouveaux riches. Its ecosystem has put China on pace to become a global leader in electric and driverless cars within 10 years. It is also on track to become a leading Artificial Intelligence developer. The business ecosystems of Chinese companies differ sharply from those of US juggernauts such as Google, Amazon, Facebook and Apple, according to Greeven, whose book came out in September. In the US, one company usually creates a platform which outside companies either plug into or use. In China, an outside company does not plug in, but becomes part of the business as one of hundreds of players in an ecosystem, Greeven argues.

Where would you expect to find the world’s most innovative talent development program or a meld of big data and artificial intelligence
together predicting employee resignations with 95% accuracy? Your answer probably would not be China, but think again. While dreadful personnel management practices, as well as dangerous labor abuses, can still be found in the country, it would be a pity to ignore the innovation going on. Chinese companies have been the quickest to adopt new technologies such as big data, artificial intelligence and talent analytics. Their innovative human resources practices can bring a fresh perspective from one of the world’s most dynamic markets.

In the last decades China has been building the foundations to become a modern and prosperous society. However, as suggested by President Xi Jinping in the 19th Party Congress, the rise of China depends on continued efforts in reducing income inequality and job creation. In my opinion it is good news that President Xi also addressed the importance of a world class talent development system to support China’s future. As an educator I look forward to continuous efforts in reforming and improving education for all in China.